Medical Device Link.

EDITOR'S PAGE

Last year, the IVD industry witnessed two blockbuster deals in which Siemens Medical Solutions (Malvern, PA) acquired both Diagnostic Products Corp. and Bayer Diagnostics. A new major player, General Electric Co. (GE; Fairfield, CT), has also recently entered the IVD market after purchasing the primary IVD businesses of Abbott Laboratories and Abbott Point-of-Care (see Trends & Perspectives).

Together, GE and Siemens have spent more than $15 billion to enter the IVD market. By making these multi-billion-dollar investments, these companies have demonstrated not only their strong belief that there is a bright future in IVDs but also their commitment to the IVD market. The emergence of GE and Siemens as major players in the IVD industry could significantly shape and influence the future direction of the industry by prompting a paradigm shift in how IVDs are developed and delivered.

On the surface, it would appear that the GE and Siemens acquisitions are simply the case of two medical device companies with well-established imaging technologies broadening their portfolio of diagnostic tools by adding IVDs. Granted, there is some truth to that: these companies have always wanted to include IVDs in their product lines. However, GE and Siemens officials said that their companies plan to do much more than merely expand their diagnostic portfolios.

With their acquisitions, GE and Siemens will be actively looking for synergies between IVDs and in vivo diagnostic imaging. Officials for both companies stressed their intention to create fully integrated diagnostics companies that bring together IVDs, in vivo imaging, and healthcare information technology. GE and Siemens foresee a convergence of IVD and in vivo technologies such that the two technologies will work hand-in-hand and be closely linked for providing clinical diagnoses. With their combined efforts, these companies could push the IVD market toward greater merging of IVD and in vivo technologies.

If GE and Siemens succeed in this convergence of IVD and in vivo technologies, other IVD manufacturers will have to follow suit by bringing in vivo technologies into their product offerings. Such changes may be necessary in order to compete and keep up with GE, Siemens, and other IVD companies that employ this new model.

It will be interesting to see exactly how and to what extent GE and Siemens will affect the IVD industry. More mergers, acquisitions, and various other types of partnerships and alliances between IVD companies and diagnostic imaging companies could emerge. Consequently, IVD manufacturers should keep a close eye on how the IVD market evolves, and what types of new products are being developed and released.

Richard Park